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Which of the following statements best explains how using a pro…

  • Question 3c of 10 - PPF

  • Maximum Attempts: 1
  • Question Type: Multiple Choice
  • Maximum Score: 2
  • Question: Which of the following statements best explains how using a production possibilities frontier (PPF) helps set up efficient production?
  • Answers:
  1. A PPF helps predict whether gross domestic product is rising or falling.
  2. A PPF shows the maximum amount of goods that can be produced with a given set of inputs.
  3. A PPF allows a producer to calculate the cost of producing one more unit of goods.
  4. A PPF allows a producer to balance supply and demand in order to find the best selling price.

The correct answer is: A PPF shows the maximum amount of goods that can be produced with a given set of inputs. The PPF helps reduce waste by maximizing output.

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